USD/JPY holds near ¥157.77 support amid Japanese business leaders warn on yen weakness

Traders Union
All News
Financial News
US Dollar vs Yen gains 0.5% today

Highlights

The US and Japanese governments jointly intervened in the foreign exchange market for the first time since 2011, buying yen to halt a historic drop toward 164 yen per dollar.
Japanese firms reported growing challenges from sustained yen weakness and increased import costs, impacting corporate planning despite some exporter gains.
USD/JPY maintains a bullish trend with strong momentum signals and is expected to consolidate between 158.07 and 159.65 over the next 2 to 3 days.

Yen gains as joint us-japan intervention tempers record lows

On July 31, 2026, the US and Japanese governments carried out their first coordinated intervention in the foreign exchange market since 2011, jointly purchasing Japanese yen to counter a historic plunge that saw the currency approach a 40-year low near 164 yen per US dollar, according to Fofahk. Such intervention provided immediate support for the yen by increasing official demand and seeking to stabilize volatility in the USD/JPY pair. At the same time, Japanese business leaders have flagged mounting challenges from persistent yen weakness and sharp currency fluctuations, with higher import costs complicating corporate planning despite some benefit for exporters, as reported by Econotimes.

Buyer dominance as technicals flag overbought risks

USD/JPY is showing clear technical alignment above its MA-20 and MA-50 on the H1 chart, and also sits above the MA-200 at ¥158.68. The Ichimoku Kijun level at ¥157.77 serves as immediate support for the pair. Indicators signal ongoing upward momentum: both MACD and ADX remain in Buy territory, while Bull/Bear Power confirms buyer dominance in intraday trading and the Awesome Oscillator supports the prevailing trend. However, Stochastic RSI and CCI are in overbought zones alongside a strong Buy reading from RSI, pointing to the risk of short-term exhaustion.

Bullish tilt as consolidation persists within narrow band

Over the next 2–3 trading days, USD/JPY is expected to remain in a consolidation range between ¥158.07 and ¥159.65, reflecting typical volatility for the pair. The probability of an upward move stands at 75%, while a downside scenario has a 25% chance, especially if the Ichimoku Kijun support at ¥157.77 is breached. The baseline case calls for sideway action within the stated corridor, with a bullish breakout possible if resistance levels are overcome and a bearish scenario emerging should key support give way.

Anton Kharitonov, expert at Traders Union, notes that the joint currency intervention by the US and Japan has offered short-term relief for the yen but has not resolved deeper volatility concerns. He sees USD/JPY technically strong above major averages, yet flagging clear risks of exhaustion as key indicators flash overbought. Kharitonov remains cautious, emphasizing that broader sentiment among Japanese corporates points to structural challenges as elevated import costs persist. "Until the pair breaks out of the ¥158.07–¥159.65 range, my base case is extended consolidation with sharp reactions likely if support or resistance gives way."

Earlier, analysts noted that coordinated intervention by US and Japanese authorities provided only brief support for the yen, with persistent downside risks prevailing due to structural weaknesses. The current technical setup signals a shift in near-term momentum, making a sustained close above ¥159.65 a key level to watch for confirmation of renewed upside in the USD/JPY pair.

Source of Data: USD Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

The information is based on forecasts and does not constitute investment advice or a guarantee of future results. Market conditions may change. See our Disclaimer and Editorial Integrity for details.